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If nothing is done to address the structural imbalance in the General Fund, reserves will be <br />depleted in FYl 1, just prior to FY12 when the General Fund must absorb another $2.7 million <br />(FY07 $) of library costs. <br />The General Fund additions to my FY08 proposed budget are limited to a very few high priority <br />activities. A complete listing of the service changes in all funds is provided in Attachment A to <br />this message and many of the changes are discussed under Council Goals (see below). Many <br />department-initiated changes and much of the work on City Council goals will be delayed until <br />a reprioritization of the. General Fund occurs. We brought the Multi-Year Financial Plan to you <br />for review in January of this year. That plan highlights our view of the organization's primary <br />strategic unfunded needs costing more than $250,000. Unfortunately, this budget does not and <br />cannot make much progress toward reducing those identified needs. <br />. In order to balance General Fund operations and best align City programs with desired service <br />levels, I propose allocation of $100,000 to conduct a process beginning this summer to review <br />General Fund-supported services in FY08, so that the FY09 budget provides the level and mix <br />of services our community values most. Until this occurs, the City has a very limited ability to <br />' address emerging and new community needs and concerns without reducing existing programs <br />or depleting reserves more quickly. The last comprehensive prioritization of the General Fund <br />. was conducted in October 2002 and may no longer reflect today's needs. It is time to check in <br />' with policymakers, stakeholders and the public to ensure that the level and mix of services <br />provided by the General Fund are sustainable and meet community expectations. <br />More specifically, my recommended approach is to categorize programs within each of our <br />General Fund services as "minimum," "core," or "optimal," and to identify the current service <br />level, expected outcomes, and possible alternatives to that service level in each program. For <br />example, the Police patrol service has a proposed budget of $25.4 million in FY08. Within that <br />service are many programs and service levels, some of which are essential or "minimum" (e.g., <br />Call Response Level 1- in progress felonies and violent misdemeanors), some are "core" (e.g., <br />property crime investigations), and some are entirely discretionary or "optimal" (e.g., <br />community outreach events). Our goal will be to clearly communicate to you and to the <br />community the nature, outcomes and cost of each service. This information, along with the <br />current gaps and future needs identified in the Multi-year Financial Plan, should enable the <br />community to make more informed choices regarding the appropriate level and mix of services <br />to provide with General Fund resources. <br />This budget steers a pragmatic course to a needed correction in FY09, giving us the time to <br />undertake a thoughtful and thorough review of General Fund service levels, costs and priorities. <br />We have successfully resolved many funding issues in previous years such as looming deficits <br />in the stormwater, construction permits, ambulance transport, and cultural services funds. <br />Work on closing the expanding gap in transportation funding continues with renewed resolve. <br />I am optimistic that we will find a sustainable, locally controlled and satisfying long-term <br />solution to the General Fund's structural imbalance. <br />The temptation to respond to every urgent community need and/or request for allocation of one- <br />time money from General Fund reserves should be resolutely resisted. While providing some <br />short-term relief, these decisions delay long-term solutions and deplete the' City's financial <br />3 <br />